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China data weakness raises stimulus watch into September Politburo

TD Securities says Beijing may need counter-cyclical measures to hit its 2026 GDP target of 4.5% to 5.0%, especially if August data fails to rebound.

Reported · Written up by our desk · Central Banks

TD Securities economist Alex Loo flagged that China’s July figures pointed to weaker momentum, with softer industrial production, modest retail sales, and record-weak fixed assets investment. The note added that the data bolsters concerns that domestic demand may be insufficient.

The report warned that if the trend continues, China risks missing its 2026 GDP goal of 4.5% to 5.0%. It also said policymakers could respond with stronger counter-cyclical steps and fresh stimulus signals.

FXStreet carried the TD Securities view that the next key decision point would be the September Politburo (Economic) meeting, given concern that waning momentum could be a major challenge if August data does not show signs of improvement.

In the broader market context included with the note, FXStreet said expectations about the Federal Reserve moving in September were fading, which supported the US dollar on the margin and helped keep GBP/USD near recent highs and EUR/USD above 1.1500. The same update noted upcoming Germany’s ZEW and multiple US data releases on Tuesday.

Latest closeEUR/USD 1.157 ▲0.4%|GBP/USD 1.354 ▲0.3%

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